Expert shares two strategies to eliminate debt faster
(InvestigateTV) — Thirty percent of Americans are looking to pay off one or more debts this year, according to a new NerdWallet study.
The resolution comes as a third of Americans felt optimistic about their finances going into the new year, according to the 2026 Consumer Outlook. However, just as many Americans are feeling stressed about their financial situation.
Sara Rathner, a personal finance expert with NerdWallet, said paying off debt is a great goal that people can start tackling immediately.
For those with high-interest credit card debt, Rathner recommended chipping away at it as aggressively as the budget allows to free up more money.
“Pull up the most recent credit card statements you have or other statements for other debts and write down how much you still owe and what interest rate you’re being charged, because a lot of people don’t actually know this amount,” Rathner said. “You are making these payments every month, sometimes even just the minimum payment. And you’re on auto pilot, so take yourself off autopilot and see where you are today.”
Rathner outlined two approaches for debt repayment plans.
The “debt avalanche” method prioritizes saving money on interest by focusing on the highest interest rate debt first while making minimum payments on other debts. Once the high-interest debt is eliminated, borrowers move on to the next debt on their list.
For those struggling with motivation, Rathner suggests the “debt snowball” approach, where the smallest debt is paid off first to create a sense of progress and victory before moving to the next largest debt.
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